AAC Shares Soaring Following Strong 3Q Earnings Report

11/06/2017 - ATIN - The price of American Addiction Centers (NYSE: AAC) shares are soaring in a strong multi-session rally driven by last week's release of quarterly earnings, which met or exceeded expectations. Nashville-based AAC has repeatedly failed to meet earnings expectations over the past year or so, which is why for most of the month of October shares traded in a range of $7.50 to $8.50, not far above the company's all-time low trade of $6 a share.

On Monday, investors continued to steadily drive AAC shares higher on big volume. About 270,000 AAC shares traded Monday, approximately twice the average daily voiume over the past three months. Shares closed at $11.14 Monday, up nearly 50 percent since AAC reported 3rd quarter earnings Wednesday afternoon.

Revenues for the third quarter surged 14 percent to $80.4M while operating expenses fell 10 percent, which strengthend investors confidence in the company's quality of earnings and profitability.Also underscoring continued high qualiytty of earnongs, AAC reported that the average daily residential rate was $925, up an astounding 48 percent. Average revenue per outpatient visit surged 33 percent to $437.

AAC's growth is to a large extent being driven by mergers and acquisitions, as well as "de novo" or greenfield new center develoiopment. In September, AAC reached a definitive agreement to acquire AdCare for consiuderstion of $85M. AdCare is one of the Northeast's largest and well regarded treatment enterprises.

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